STATEN ISLAND: AN UNDERRATED RETAIL INVESTMENT
New Yorkers are known for their partiality to their borough. So I might ruffle some feathers with what I'm about to say. But I think you'll understand my reasoning by the end of my post. Staten Island is the jewel of New York, and a great area to own retail real estate from Kimco's perspective. Here's why:
1. Staten Island's demographics are strong. Staten Island has a population of 468,730, up 5.6 percent since 2000. Staten Island is the third largest New York borough with an area of nearly 59 square miles. This makes the island densely populated, with 8,030 people per square mile, according to Census data. As the population grows, so does demand for essential everyday shopping. Spending power is also strong, with a median household income of $65,388, well above the New York average of $54,554.
2. Staten Island is the most suburban New York borough. Unlike the streets in New York's other boroughs, Staten Island's streets don't follow a grid system. Staten Island is also the most auto-centric borough in New York, with 82 percent of households owning cars. Staten Islanders make an average of nine automobile-based trips a week, the highest of all borough residents, according to a PlaNYC report. Suburbia naturally provides the ability for retailers to develop and expand their spaces.
3. The island's geography compels many residents to stay there to shop. Many Staten Islanders often stay on the island to do their everyday shopping because it's close, convenient, and avoids traffic and hefty bridge tolls going into New Jersey and Brooklyn. This helps enable retailers to build strong customer bases.
We recognized early on that Staten Island was an area in need of services, and we've since added six Staten Island shopping centers to our portfolio over the past 20 years. We're now one of the largest owners of shopping centers on Staten Island.
Kimco acquired these properties for all of the reasons explained above. But in addition, we also saw future redevelopment opportunities in properties that would let us build more value and improve the quality of our portfolio.
Today, two of our Staten Island properties are under active redevelopment, with future plans being mapped out for the other properties. Here's an update on where we stand with our plans for all our Staten Island centers, including those being redeveloped now, as well as opportunities we see for future redevelopment and leasing.
Richmond Avenue Shopping Center (Kimco site #0601) Richmond Ave. & Yukon Ave Richmond shopping center is at the heart of the retail trading area on Staten Island, about a quarter mile south of the Staten Island Mall. Richmond was the first property that Kimco acquired in the borough back in 1989, and it has undergone several renovations through the years. As has been reported in local media, Kmart's lease in this location has expired, and Kimco will bring in a 142,000-square-foot Target in 2013 to fill the need for a home goods tenant in the center. Additionally, the entire property will be upgraded with a new facade, signage, parking lot, parking lot lighting, and landscaping. We believe that the Richmond center will be the preeminent shopping destination on the island.
Staten Island Plaza (Kimco site #1285) New Dorp Lane Kimco bought approximately six square acres of land sitting right behind our Hylan Plaza shopping center in 2005, and signed a lease with Kohl's to build a two-level, 100,000-square-foot store. Kohl's is much-anticipated by local community leaders and residents, as there is currently only one Kohl's on Staten Island. Construction is anticipated to start this spring with a late 2013 grand opening.
Forest Avenue Shopping Center (Kimco site #0031) Forest Ave. & Barrett Ave. This shopping center was anchored by National Wholesale Liquidators, T.J. Maxx, Michaels, and several other shops when we acquired it in 2000. National Wholesale Liquidators filed for bankruptcy in 2008, and then closed the store. We then put together a plan to redevelop the shopping center. Our current plan is to redevelop the box as well as some of the adjacent vacant shops into a 56,000-square-foot anchor. We also have plans to renovate the facade, signage, and parking lot.
Hylan Plaza (Kimco site #1339) Hylan Blvd. & Beach Ave. Hylan Plaza is the property with the greatest future redevelopment potential in Kimco's Staten Island portfolio, given its attractive location on Hylan Boulevard, a major retail hub in the borough. Kimco has owned the 358,155-square-foot center since 2006, and the center offers grocery and home goods shopping to local residents. We hope to add a few popular national retailers to the mix in the coming years.
Greenridge Plaza (Kimco site #0674) Arthur Kill Rd. & Richmond Ave. Greenridge Plaza was anchored by Waldbaum's and CVS when we acquired it in 1997. A&P, which owns Waldbaums, recently assigned the lease to King Kullen. It was then announced that King Kullen would be closing all locations on Staten Island. We are now negotiating with several grocery stores to replace this location. We have also replaced CVS with Dollar Tree in the past several years, when CVS moved to a free-standing location with a drive thru. We are actively looking at plans to renovate this shopping center in the future.
Forest Avenue Plaza (Kimco site #1343) Forest Ave. & Riegelman St. Kimco added Forest Avenue Plaza to its portfolio in 2005. The center is fully leased, and is anchored by strong performers Staples and PetSmart. In fact, this is the only PetSmart location on Staten Island, and it draws many loyal pet lovers to its store. While we are happy with the general retail mix in the center, Kimco might include an aesthetics update of the property in its future development plans.
As we've developed and redeveloped on Staten Island over the past 20 years, we've continued to see the value in the area. The borough, city, and community have supported us well as we've turned many properties around and redeveloped them into centers where people like to shop and can buy their everyday essentials.
Our main goal today is to complete our redevelopment projects, and give Staten Islanders a better place to shop. Looking forward, we're continuing to seek stable assets on Staten Island that we can acquire and develop or redevelop to strengthen our portfolio base and the area's economy.
If you're interested in learning more about these properties, the areas they're located in, and future leasing opportunities, follow the links to the properties on our website. You'll find site plans, property data, area demographics, tenant lists, contact information for our property managers, and more.